Infrastructure Alert - July 2014

The Senate begins debate today on a bill to prevent the insolvency of the Highway Trust Fund. The bill, already passed by the House and supported by the White House, provides the best chance for Congress to prevent the projected insolvency given the upcoming August recess. Although the Senate is considering four amendments to the bill, under the short time frame before recess and the urgency to pass a stopgap measure, the bill is likely to pass without amendment so that it will not have to return for another vote in the House.

ON THE HILL

On July 15, the House passed H.R. 5021, the Highway and Transportation Funding Act of 2014, a bill to extend the solvency of the Highway Trust Fund through May. The bill passed by a vote of 367-55, and now awaits a vote in the Senate. The vote for the bill was 186 Democrats and 181 Republicans, whereas 45 Republicans and 10 Democrats voted against. No floor amendments were permitted. The $11 billion, 10-month bill includes a $1 billion LUST Trust Fund transfer, $3.5 billion in customs fees, and $6.4 billion in “pension smoothing” to bolster the Highway Trust Fund.

The Senate will begin debate on the H.R. 5021 this afternoon. Under a unanimous consent agreement, only four amendments will be considered: Wyden #3582, Carper-Corker-Boxer #3583, Lee #3584 and Toomey #3585. The amendment proposed by Sen. Ron Wyden (D-Ore.) is the text of the Preserving America’s Transit and Highways Act, the Senate Finance Committee’s Highway Trust Fund patch. The Carper-Corker-Boxer amendment would remove the pension-smoothing provision and extend the solvency of the Highway Trust Fund only through the end of the year. The amendment proposed by Sen. Mike Lee (R-Utah) is the text of S. 1702, the Transportation Empowerment Act, that would “devolve” most of the responsibility of raising and disbursing transportation funds to the states and cut the federal gasoline tax to 3.7¢ per gallon. The amendment proposed by Sen. Pat Toomey (R-Pa.) would waive most environmental reviews in post-disaster situations to expedite the re-construction of transportation infrastructure.

The White House released a Statement of Administration Policy supporting the passage of the bill to “provide for continuity of funding for the Highway Trust Fund” but notes that “Congress should work to pass a long-term authorization bill well before the expiration date set forth in H.R. 5021.”

AT THE AGENCIES

On July 25, Anne Ferro of the Federal Motor Carrier Safety Administration announced she would resign from her post, after serving as Administrator for five years.

Also on July 25, the Senate approved Victor Mendez as Deputy Secretary of Transportation and Peter Rogoff as Undersecretary for Policy. Both had been serving in as acting in that capacity. Therese McMillan, the Deputy Administrator of the Federal Transit Administration (FTA), will be nominated to replace Rogoff as Administrator of the FTA. On July 15, Chip Jaenichen was confirmed by the Senate as Maritime Administrator. He has been with the Maritime Administration since July 2012, when he was appointed Deputy Maritime Administrator.

On July 23, the Department of Transportation announced a major notice of proposed rulemaking designed to curtail accidents of trains carrying Bakken crude oil. The increase of crashes in 2014 alone have drawn public scrutiny, and the day following the rule announcement a derailment occurred in Seattle. The notice of proposed rulemaking predicts “15 mainline derailments for 2015, falling to a prediction of about 5 mainline derailments annually by 2034” without the proposed rule.

On July 23, the Government Accountability Office published a report titled “Aviation Safety: FAA’s Efforts to Implement Recommendations to Improve Certification and Regulatory Consistency Face Some Challenges.”

On July 21, Secretary of Transportation Anthony Foxx and 11 former secretaries of transportation published an open letter to Congress, urging Members to pass a sustainable surface transportation bill.

On July 14, the Maritime Administration requested comments on its draft Programmatic Environmental Assessment to evaluate potential environmental impacts associated with the execution of the Marine Highway program.

IN THE STATES

California: The Third District Court of Appeals in Sacramento upheld the proposed Pacheco Pass route in California’s High-Speed Rail plans. The court ruled that the project must abide by state environmental rules, despite the state arguing that it was exempt from the California Environmental Quality Act because the project is overseen by the Surface Transportation Board.

New York: A Long Island Rail Road (LIRR) strike was averted on July 17 after Governor Cuomo intervened. The potential strike was looming as four years had passed since the last labor contract expired. Under the new contract, union workers will receive a raise of 17 percent over the next six and a half years, though workers will now pay 2 percent of their pay towards their health care coverage cost. Previous to the agreement, the unions had requested the 17 percent pay raise over six years, whereas the Metropolitan Transit Authority had insisted it be spread over seven years.

Virginia: On July 26, the initial 12-mile phase of the Washington Metropolitan Area Transit Authority’s Silver Line began operation. The Silver Line will expand another 11 miles by 2018 to Dulles International Airport. This first stretch cost $2.9 billion, and the remaining extension is expected to cost an additional $2.7 billion. The Silver Line was approved for a $1.9 billion TIFIA loan in May.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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